Valuation
Solo practices commonly trade around 60-85% of annual collections (dental) or a multiple of seller’s discretionary earnings; larger groups price on EBITDA multiples. Whatever the method, the number you’re really buying is transferable cash flow: collections that survive the seller leaving, verified against remittances, not the PM system’s charge report.The LOI
Non-binding on price but it locks the shape: price and what’s included, asset vs. equity purchase (asset deals dominate small practice M&A, buyers avoid inherited liabilities and get a tax basis step-up; equity deals keep the TIN and payer contracts alive, which matters in CPOM states), exclusivity period, seller transition terms, and who pays which costs. Get deal counsel before signing the LOI, not after.Due diligence
The classic buyer mistake is closing before your own credentialing is filed:
you own the practice but can’t bill in-network for 90+ days. Sequence
credentialing from LOI signing, and price the gap into working capital
(loan sizing).